5 Reasons Why You Should Replace Paper Punch Cards with a Loyalty App

As customer loyalty programs are evolving into the digital age, the way consumers perceive brand loyalty is changing along with it.  

Many businesses are still clinging onto the idea that, because plastic loyalty cards are cheap and easy to set up and maintain, they are a more cost-effective system than implementing a mobile loyalty app for their loyalty program. However, when you look at the facts, this isn’t the case.

So, why are mobile loyalty apps replacing traditional loyalty programs so rapidly? And why should you go digital with your loyalty program? Let’s find out.

These 5 Reasons Explain Why You Should Consider Replacing Paper Punch Cards with A Loyalty App...

1. To Meet Customer Expectations & Preferences

In 2018, CodeBroker surveyed more than 440 millennials belonging to loyalty programs from retail, credit cards, restaurants, travel and other industries and a staggering 97 percent said they would actively engage with loyalty programs if they could access their rewards information directly from their smartphones.

Considering that millennials currently have more spending power than any other generation, it’s crucial to ensure your brand is meeting this segment of consumers’ needs and expectations.

In regards to the rest of consumers, a recent report from Vibes found that 73 percent of smartphone users are keen to have all their loyalty program memberships saved on their device for ease of use and convenient storage.

The same report also found that the vast majority of consumers have more favourable opinions of loyalty programs that have adapted to be optimised for smartphones.

These days, we use our mobile phones for almost everything, and rarely leave the house without them. However, paper or plastic loyalty cards are almost always forgotten (or lost).  

2. To Engage With Customers

One of the biggest benefits of mobile app loyalty programs replacing paper punch cards is the opportunities they provide for customer engagement.

Digital loyalty apps, like Stamp Me, allow direct communication with customers through Push notifications or SMS.

Perhaps you might like to wish your customers Happy Birthday and send them an exclusive offer or reward. This small gesture has a huge impact. With one click of a button, you have made them feel special and helped to build their trust with your brand - congratulations!

Another way to keep customers engaged is to reach out to the customers who you haven’t seen for a while. Send them a message to stay at the front of their mind and prompt them to come back.

Digital loyalty programs help businesses deliver the right messages, at the right time, to the right customers.

3. To Keep Up With Industry Trends

Personalisation is a major trend in the customer loyalty industry and is highly important for creating a great customer experience.

The 2016 Vibes study revealed that 77 percent of consumers said if a brand was to send them personalised messages regarding exclusive deals, birthday or anniversary gifts, and other surprise offers, this would have a hugely positive effect on their brand loyalty (as discussed above).

Paper cards simply can’t engage with customers on this level. They offer a “one size fits all” approach, and consumers are no longer satisfied with this.

We expect a more personalised experience from the brands we choose to shop with.

Brands that make the effort to innovate and evolve with their customers can expect increased loyalty and business in return.

4. To Stand out Against Your Competitors​

If you are meeting all the above points, i.e. keeping up with consumer preferences and expectations, engaging with customers, and delivering personalized messages, you are most certainly going to stand out from your competitors who are not.

5. To Know Who Your Customers Are

Digital loyalty apps allow you to accumulate data on each customer who signs up, such as their contact information, date of birth (if provided), purchase and visitation frequency, and other invaluable information that in turn provides you with upselling and cross-selling opportunities.

Note: not all loyalty platform providers will share this information with you.

When you use this information to group your loyal customers into several specific categories based on demographics, purchase frequency, and other tendencies, you can tailor your marketing strategies to be more relevant to each customer.

This is called customer segmentation, and it prevents your customers from feeling like they are just walking dollar signs to your business, which is often the case when companies send out a mass email or SMS promotions that don’t include personalization or content that is relevant to that customer.

FAQ: Can’t I have both?

The trouble with having both physical loyalty cards and a loyalty card app running side-by-side is that the whole idea behind a loyalty program is to make it as simple and streamlined as possible.

Having two systems operating together convolutes the whole process, causes confusion, and discourages customers from signing up because they can’t be bothered learning how it works.

For a loyalty program to be effective:

• It needs to be clear.
• It needs to be quick and easy to sign up.
• It needs to be simple to use and understand.

Want to launch a loyalty program but need a bit of help? Check out our free Digital Loyalty Program Launch Checklist!